Published | Categories: GST and QST, Income tax - businesses, Source deductions and contributions

Keeping Business Records

If you operate a business in Québec, you must keep records. You must also keep records if you are responsible for deducting, withholding or collecting amounts pursuant to the Excise Tax Act and the Act respecting the Québec sales tax. Records can be in the form of books of account or journals.

Your records and supporting documents must be kept, in paper or electronic format, at your place of business, your residence or another place designated by Revenu Québec.

You must at all times be prepared to make your records and supporting documents available in a timely manner in case Revenu Québec decides to carry out an audit. Information in these documents must allow Revenu Québec to verify:

  • your business income and expenses, so that any amount due can be determined
  • the GST and QST amounts collected
  • the tax amounts paid if you claimed input tax credits or input tax refunds
  • information used to calculate source deductions and employer contributions

You must also keep certain documents as proof of this information, for example:

  • the daily statements of your income along with your invoices and your cash register tape
  • the daily statements of your expenses along with your cancelled and voided cheques and your receipts
  • a statement of kilometres travelled for each vehicle used in part for business and in part for personal purposes
  • documents substantiating trips
  • documents substantiating capital expenditures
  • your credit card bills and monthly statements
  • records indicating your employees' names, their salaries and wages, and the amounts withheld from the remuneration you pay them

How long must you keep records and supporting documents?

As a rule, records and supporting documents must be kept for at least six years after the taxation year to which they pertain. It may be necessary for you to keep your records for more than six years if you file your return late, you file a notice of objection or you file an appeal with the courts.

Records and supporting documents kept on an electronic or computerized medium must be retained in an intelligible form on the same medium, for the required period of time.

For more information, refer to the Retention and Destruction of Registers and Supporting Documents (LMR. 34-1/R1) bulletin or the Keeping Records (RC4409) guide.

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